It’s been a wild ride for methane regulations in the U.S., and the latest chapter came onThursday when Congress officially overturned the Environmental Protection Agency’s (EPA) methane fee, a major piece of the Biden administration’s emissions-reduction efforts. The now-defunct fee—part of the Methane Emissions Reduction Program (MERP) created under the Inflation Reduction Act (IRA)—was designed to charge oil and gas producers for excess methane emissions, starting at $900 per metric ton in 2024 and ramping up to $1,500 by 2026. But the policy met fierce opposition, culminating in last week’s Congressional Review Act resolution to scrap it. Industry groups, including the American Petroleum Institute (API), cheered the move, calling the fee an unnecessary tax that ignored the significant methane-cutting progress the industry has already made. EQT executives have echoed similar concerns in the past, arguing that regulatory frameworks should encourage innovation rather than impose punitive charges on producers who have already invested in methane reduction technologies.
This is far from the first time methane has been in the regulatory crosshairs. When the EPA first proposed MERP back in early 2024, it was clear the agency was aiming for aggressive emissions cuts, projecting a reduction of 6.4 million metric tons of carbon dioxide equivalent (MMtCO2e) in the first year alone. But methane intensity (MI)—a key metric in the discussion—has been an issue for years, particularly as U.S. LNG exports grow. As we’ve discussed in RBN blogs like Show Me the Way, LNG exporters are keeping a close eye on the MI of their feedgas, knowing that future regulations—like those in the European Union—could penalize gas with higher methane emissions. With major new LNG export terminals coming online and shifting gas flows across the U.S., questions remain about how MI standards will evolve and whether regulatory pressure on methane emissions will persist, even in the absence of the MERP fee.
Despite the Congressional rollback, the broader regulatory landscape is still evolving. The EPA’s final methane rule, issued in late 2023, includes new requirements for leak detection and repair (LDAR) and a phasedown of routine flaring. For oil and gas producers, that means the pressure to curb methane emissions isn’t going away anytime soon. And with growing international scrutiny on MI—particularly from key LNG buyers in Europe and Asia—the industry is may see shifts in how methane emissions are tracked, mitigated, and monetized in the future. Bottom line? While Congress may have taken the teeth out of the methane fee, the push for lower MI and stricter methane oversight isn’t fading into the background—it’s just moving to a different playing field.
